The milk-feed price ratio advanced 0.06 points — to 3.44 for November, according to the USDA’s “Agricultural Prices” report released Nov. 30. However, that is 0.13 points less than a year ago.
The October ratio was revised to 3.38 — a decrease of 0.06 points versus the 3.44 ratio reported at the end of October. The downward revision is the result of a 10-cent increase in the all-milk price coupled with increasing corn and soybean prices. The price of baled alfalfa hay was unchanged.
During November, the corn price fell a mere 3 cents per bushel — to $1.79. That also is 26 cents less than a year ago. On the other hand, the soybean price gained a penny, putting it at $5.68 per bushel. That also is 32 cents higher than November 2004. Baled alfalfa hay fell $8.50 — to $97.50 per ton. However, that is still $2.30 more per ton than a year ago.
The all-milk price used to calculate the ratio decreased 40 cents – to $15.10 per hundredweight. That also is $1.10 less than a year ago.
The milk-feed ratio represents the pounds of 16-percent mixed dairy feed equal in value to 1 pound of whole milk. Therefore, with a 3.44 ratio in November, a dairy producer could buy 3.44 pounds of feed for every 1 pound of milk sold.
Whenever the ratio meets or exceeds 3.0, it is considered profitable to buy feed and produce milk.